Equitable Payments for Watershed Services

Geographical location:

Summary

CARE, in consortium with WWF and the International Institute for Environment and Development (IIED), was granted funds by the Directorate General for International Cooperation (DGIS) and the Danish International Development Agency (DANIDA) to implement this project. It aims to establish equitable payments for watershed services (PWS) in selected watersheds in the Philippines, Indonesia, Peru, Guatemala and Tanzania. In the Philippines, the project will be implemented in the watersheds of Mount Guiting-Guiting through WWF-KKP (Kabang Kalikasan ng Pilipinas), and in Mount Isarog through CARE Philippines.

Background

Payments for watershed services emerged in response to the dangers and costs of forest degradation or loss, such as water shortage and quality deterioration, and the unmet demand of particular sectors for particular forest environmental services. The
limited capacity of local and national governments to finance and enforce policies on watershed rehabilitation and protection has also stimulated local private initiative.

In Sibuyan island, Romblon Province, such watershed arrangements and payment mechanisms are being developed in 2 watersheds - Cantingas and Panangcalan - in collaboration with the local government unit (LGU) of San Fernando, the Sibuyan Mangyan Tagabukid (SMT) Indigenous Group and Kabang Kalikasan ng Pilipinas (KKP). Beginning 2005, both LGU of San Fernando and KKP have seeded the Cantingas Water Fund to finance watershed management in Panangcalan and Cantingas respectively. The fund is accessed by the Sibuyan Mangyan Tagabukid, an indigenous group recently awarded a Certificate of Ancestral Domain Title (CADT). The domain covers the headwaters and upper reaches of both watersheds.

Objectives

By 2010, equitable approaches to PWS have been established in 5 countries, and promoted within a wider learning network of governmental, private sector and civil society organisations in 20 countries.

Phase 1 of the project is conceptually, methodologically and operationally linked to phase 2, where the objective is to build on business cases and establish the PWS mechanisms in the selected sites.

Solution

While financing for watershed management is borne by the local government and KKP, the long-term solution is to have beneficiaries of watershed management contribute their fair share to the costs of watershed management. This requires understanding the hydological impacts of land use decisions as they affect the economic utility of downstream users. Water tariffs and institutional structures to manage the payments will have to be informed by studies on soils and land uses, hydrology, willingness-to-pay by various water users and opportunity costs of upland farmers.

Achievement

Over 10 months since September 2005, a total of 3,005 trees were planted. Reforestation targets were exceeded 112% with 2,464 surviving tree seedlings monitored and verified. About 95% of the reforestation budget of USD 2,300 was disbursed to 43 indigenous people (IP) families.

The voluntary patrols by IPs are an important part of the protection effort as about 5,000 hectares of the domain overlap with the Mount Guiting-Guiting Natural Park. A total of 2,503 patrol man-days were logged and USD 9,477 in payments was made to 66 families. Of the 82 IP household residents in 2006, 52% participated in reforestation while 80% participated in patrols.

The campaign resulted in the apprehension of 139 poachers and confiscation of 2,438.76 bd-ft of timber. The average rate of apprehension was 13.9 persons per month. Interviews with IPs and LGU authorities revealed decreasing incidents of illegal logging which reflects the effectiveness of patrols as deterrence to outside poachers.

The household participation rate for patrols was high at 80%. Participation in patrols is higher because slots are rotated which improves IP chances to participate. Participation rate for reforestation is lower at 52%. Participation is lower because reforestation is a one-time activity and is limited during the rainy months (July-November).

Payments were made to IP households in the form of consumer credits in a retail store in the village center. The women lobbied for this arrangement to minimize gambling and spending on alcohol by men. Every week, the women draw on these credits in the form of groceries, rice and consumer items. To avoid excessive drinking, the store allows only one alcohol beverage per family per week.

Studies on soils, land use, hydrology, valuation and cost-benefit were completed and presented in a series of multi-stakeholder fora.